New Amazon cloud chief Adam Selipsky plans to tailor more products to specific sectors such as the healthcare, automotive and telecommunications industries, a shift for a business that once focused on broader solutions that can be used by most customers.
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Selipsky told Bloomberg Television that the world around us is changing and that we're going to have to be different. It doesn't matter what we did yesterday. Amazon Web Services is taking a lead from rivals Microsoft Corp. and Alphabet Inc., which have been rolling out cloud packages designed for certain sectors. Microsoft, for example, offers targeted clouds to healthcare, retail, and space industries. Selipsky's predecessor Andy Jassy, now CEO of parent company Amazon.com Inc., avoided doing special or one-off products, even when customers asked for it. Jassy resisted tailoring cloud services to the unique requirements of governments, although he eventually relented.
AWS serves companies in virtually every industry, and is the leader in the business of providing rented computing infrastructure. Selipsky said that customers are demanding new products and focuses, including sector-specific offerings, which we are starting to do for industries like financial services and telco and healthcare and automotive. We are doing really exciting things for all of those industries and more. The strategy isn't without challenges. A shift to tailored products can result in spreading efforts too thin or slicing the strategy too fine. Some executives and workers say they are leaving for startups and new areas because they say it is harder to do broad, enterprising work at AWS. Cloud software applications sold as a service are highly profitable for companies like Microsoft, more so than the infrastructure services that Amazon dominates.
In March, Selipsky was appointed AWS chief after Jassy was chosen to replace Jeff Bezos as CEO of Amazon. Selipsky was at the helm of Tableau for five years and led the Seattle company through a re-brand of its data visualization software business and $15.3 billion sale to Salesforce in 2019. Before joining Tableau, Selipsky was Jassy's right hand at AWS, in a chief operating officer-like role that saw him overseeing the unit's sales, marketing, technical support and customer service. He joined the company in 2005.
Asked whether Amazon needs to focus more on office productivity apps, like Microsoft's cloud-based Office or Google's Workspace, Selipsky said that AWS still has the broadest and the deepest set of cloud services but that it is important for the cloud giant to build more applications. He said it might be marketing, it might be human resources, or Amazon Connect, a call center program that shows the company's ability to build specific applications on top of general-purpose cloud services. He said Amazon will leave the more granular products to partners to build. He acknowledged that AWS had to avoid getting too comfortable.
It's important to act as if we're insurgents and not to act like incumbents, Selipsky said.
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